02 09-2012 - 4 q11 earnings results presentation
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Transcript of 02 09-2012 - 4 q11 earnings results presentation
4Q11 EARNINGS PRESENTATION February 09, 2012
DISCLAIMER
The Company makes forward looking statements that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our management as well as on information currently available to us. Forward-looking statements include information regarding our current intent, beliefs or expectations, in addition to those of the members of the Board of Directors and Executive Officers of the Company.
Forward-looking statements also include information regarding our possible or assumed future operating results, as well as statements preceded or followed by, or that include, the words ''believes”, ''may”, ''will”, ''continues”, ''expects”, ''anticipates”, ''intends”, ''plans”, ''estimates”, or similar expressions.
Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions, for they relate to future events, thus depending on circumstances that may or may not occur. Our future results and the creation of value to shareholder s may differ significantly from those expressed in or suggested by these forward-looking statements. Many factors determining these results and values are beyond Cielo’s ability to control or predict.
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CIELO |HIGHLIGHTS
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Transaction financial volume ,according to market criterion totaled, R$ 95.1 billion, +25.9% Transaction financial volume, according to accounting criterion, totaled R$ 91.2 billion, +23.2%
4Q11 X 4Q10
Credit R$ 56.0 billion, +24.7% Debit R$ 35.2 billion, +20.8%
Net Income totaled R$ 1.810 billion ,-1.0% and Net Margin of 37.8%;
Adjusted EBITDA totaled R$ 2,975.2 billion,+1.7% and Adjusted EBITDA Margin of 62.0%;
2011 X 2010 Net Operanting Revenue+ prepayment of receivables totaled R$ 1.383 billion +20.5%
Transaction financial volume, according to market criterion, totaled R$ 320.4 billion, +22.0%
Transaction financial volume, according to accounting criterion ,totaled R$ 315.8 billion, +20.7%
Credit R$ 197.5 billion, +21.2% Debit R$ 118.3 billion, +19.8%
1.2 million number of active merchants (60 days), + 5.2%
Net Income totaled R$ 505 million ,+13.8% and Net Margin of 36.5%;
Adjusted EBITDA totaled R$ 833 million,+16.4% and Adjusted EBITDA Margin of 60.2%;
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CIELO | ESTIMATES Indicators Expectation Dec 2011 Accomplished 4Q11
Net MDR
Credit Cards 112 -116 bps 119 bps
Debit Cards 70-73 bps 81 bps
Indicators Expectation 2H2011 Accomplished 2H2011
Financial Transaction Volume (Credit and Debit cards)
% 19.5 – 21.5 21.0
R$ billion 168.8- 171.7 171.0
Investment in POS (R$ million) 210- 230 271*
Indicators Expectation 2011 Accomplished 2011
Unit Costs + Expenses excluding subsidiaries
R$ 0.41 R$ 0.41
* Of this amount ,R$150 million is part of the credit line (Finame) financed by the BNDES
CIELO | FAIR SHARE
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Source : Earnings reported by the acquiring companies Others = Redecard e Santander/GetNet
Financial Volume Breakdown (in R$)
Considering the 2 main participants, Cielo gained 1.6 p.p. quarter-on-quarter
Considering the top three participants, Cielo gained 1.3 p.p. quarter-on-quarter
59,6% 56,9% 57,2% 57,7% 57,9% 59,5%
40,4% 43,1% 42,8% 42,3% 42,1% 40,5%
3Q10 4Q10 1Q11 2Q11 3Q11 4Q11
Cielo Redecard
59.4% 56.3% 56.4% 56.7% 56.7% 58,0%
40.6% 43.7% 43.6% 43.3%
43.3% 42,0%
3Q10 4Q10 1Q11 2Q11 3Q11 4Q11
Cielo Others
Financial Indicators 4Q11 4Q10 4Q11 X 4Q10 3Q11 4Q11 X 3Q11
Financial Volume (R$ million)
91,252.7 74,079.8 23.2% 79,775.2 14.4%
Transaction (million)
1,301.8 1,108.3 17.5% 1,167.0 11.6%
Net Revenue* (R$ million)
1,383.1 1,147.9 20.5% 1,210.9 14.2%
Cost of Services (R$ million)
(405.7) (354.6) 14.4% (365.6) 11.0%
Operating Expenses (R$ million)
(207.9) (130.4) 59.4% (165.8) 25.4%
Adjusted EBITDA (R$ million)
833.2 715.9 16.4% 741.2 12.4%
Net Income (R$ million)
504.5 443.3 13.8% 457.5 10.3%
Blended Net MDR (bps)
105 110 (5) 103 2
Credit Net MDR (bps) 119 132 (12) 118 1
Debit Net MDR (bps) 81 77 4 77 4
CIELO | FINANCIAL INDICATORS
6 * Including prepayment of receivables present value adjusted
Financial Indicators 2011 2010 2011 X 2010
Financial Volume (R$ million)
315,856.2 261,675.3 20.7%
Transaction (million)
4.621,6 4,038.7 14.4%
Net Revenue* (R$ million)
4.795,4 4.354,4 10.1%
Cost of Services (R$ million)
(1.425,2) (1.180,8) 20.7%
Operating Expenses (R$ million)
(632.7) (441.0) 43.5%
Adjusted EBITDA (R$ million)
2,975.2 2,925.8 1.7%
Net Income (R$ million)
1,810.3 1,829.3 -1.0%
Blended Net MDR (bps) 103 119 (16)
Credit Net MDR (bps) 119 142 (23)
Debit Net MDR (bps) 77 80 (3)
CIELO | FINANCIAL INDICATORS
7 * Including prepayment of receivables present value adjusted
CIELO | OPERATING PERFORMANCE
8
5.2%
CAGR: 23.3% CAGR: 17.9%
136,500
315,856
175,552
213,958
261,675
23.2%
74,080 91,253 1,108
2,389
2,952
3,427
4,622
4,039
1,302
17.5%
1.403 1.720 2.003 2.323 2.658
621 730
987 1,232
1.424 1.716
1.964
487 572
2007 2008 2009 2010 2011 4Q10 4Q11
Cielo- Number of Transactions (millions)
Credit Debit
87.966 110.897 134.792 162.933
197.541
44.917 56.034
48.534 64.655
79.166
98.742
118.315
29.163 35.219
2007 2008 2009 2010 2011 4Q10 4Q11
Cielo- Financial Volume (R$ millions)
Credit cards Debit cards
824
996 1.133 1.140
1.199 1.140
1.199
2007 2008 2009 2010 2011 4T10 4T11
Cielo- Number of Active Merchants ( 1 transaction in the last 60 days)
CIELO | MERCHANTS BREAKDOWN
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61% 60% 61% 59% 59%
39% 40% 39% 41% 41%
4Q10 1Q11 2Q11 3Q11 4Q11
Financial Volume
Large Merchants Small and Medium Merchants
33% 33% 34% 33% 32%
67% 67% 66% 67% 68%
4Q10 1Q11 2Q11 3Q11 4Q11
Revenue(*)
Large Merchants Small and Medium Merchants
(*) Comissions revenue (credit, debit and equipment rental)
CIELO | REVENUES
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POS 4Q10 1Q11 2Q11 3Q11 4Q11
Average Rental (R$/month)
72 69 65 65 67
Installed POS (thousand) 1,277 1,293 1,351 1,402 1,484
MDR 4Q10 1Q11 2Q11 3Q11 4Q11
Net MDR Debit
77 76 74 77 81
Net MDR Credit
132 122 117 118 119
CAGR: 15.9%
17.1%
CAGR: 10.2%
7.5%
1,810.7
2,184.8
2,649.9
3,103.2
815.8 955.4
3,268.4
1.409,3 1.666,9
2.012,0 2.317,8 2.354,6
590,8 669,0
401,3
517,9
637,9
785,4 913,8
225,1 286,4
2007 2008 2009 2010 2011 4Q10 4Q11
Commissions Revenues (R$ million)
Credit Debit
745,9
903,1
1.067,1
1.169,9
1.101,9
275,5 296,1
2007 2008 2009 2010 2011 4Q10 4Q11
Equipment Rental (R$ million)
CIELO | PREPAYMENT OF RECEIVABLES
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61.7%
20.8%
3.016,7 3.236,9 3.376,9
3.894,6
4.899,2
6,7% 7,3%
7.2% 7,7%
8.7%
0,0 %
1,0 %
2,0 %
3,0 %
4,0 %
5,0 %
6,0 %
7,0 %
8,0 %
9,0 %
10, 0%
11, 0%
12, 0%
13, 0%
14, 0%
15, 0%
16, 0%
17, 0%
18, 0%
19, 0%
20, 0%
-
1.00 0,0
2.00 0,0
3.00 0,0
4.00 0,0
5.00 0,0
6.00 0,0
4Q10 1Q11 2Q11 3Q11 4Q11
Prepayment of Receivables
Financial prepayment volume
% Prepayment over Credit Financial Volume
66,1 62,9
58,5 56,0 55,8
4Q10 1Q11 2Q11 3Q11 4Q11
Average Term (days)
119,4 120,8 137,7
159,9
193,1
4Q10 1Q11 2Q11 3Q11 4Q11
Revenue of Prepayment of Receivables ex Adjustments (R$ million)
CIELO | COSTS
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The impact of the unit cost excluding the subsidiaries and the additional brands fee was a reduction of 9.6%
If the impact of depreciation is
eliminated in the same analysis, the reduction would have been 11.8%
Costs of services rendered
Depreciation and amortization
0.312 0.264 0.291
Unit per transaction
0.027 0.021
The impact of the unit cost excluding the subsidiaries and the additional brands fee was a increase of 2.0%
If the impact of depreciation is
eliminated in the same analysis, the increase would have been 4.1%
0.312 0.283 0.277 0.027 0.002
405.8
343.2 323.1
405.8
323.3 367.8
343,4 280,8 271,0
62,4 35,7
26,8 62,4 52,1
4Q11 Reported Costs related tosubsidiaries
Additional brandsfee
4Q11 Adjusted 4Q10 Adjusted
Costs Comparison 4Q11 X 4Q10 (R$ million)
343,4 305,4
262,9
62,4 35,7
2,2 62,4
60,4
4Q11 Reported Costs related tosubsidiaries
Additional brandsfee
4Q11 Adjusted 3Q11 Adjusted
Costs Comparison 4Q11 X 3Q11 (R$ million)
9.6%
2.0%
6.2%
13.7%
CIELO | COSTS
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The impact of the unit cost excluding the subsidiaries and the additional brands fee was a reduction of 7.1%
If the impact of depreciation is
eliminated in the same analysis, the reduction would have been 10.0%
Costs of services rendered
Depreciation and amortization
0.308 0.256 0.275
Unit per transaction
0.033 0.020
1,425.2
1,181.9
1,111.3
1.192,2
948,8 921,2
233,0
152,7
90,6 233,0 190,1
2011 Reported Costs related tosubsidiaries
Additional brands fee 2011 Adjusted 2010 Adjusted
Costs Comparison 2011 X 2010 (R$ million)
7.1%
6.4%
CIELO | OPERATING EXPENSES
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In both comparison (4Q10 x 4Q11 and 3Q11 x 4Q11), the main impact for the increase was due to marketing and sales expenses:
• campaigns with partner banks; •Joint Cielo/Elo campaigns; •Actions with major gas station chains; •Actions with franchisers; •Cielo Fidelidade; •Institutional marketing in different media
130,4
207.9
43,8 15,7
11,8 5,8 0.4
4Q10 Marketing andSales Expenses
Other Expenses Personnel General andAdministratives
Depreciationand
Amortization
4Q11
Operating Expenses Composition- 4Q10 to 4Q11 (R$ million)
165,8 207.9
37,0 8,2 3,2 0,2
(6.5)
3Q11 Marketing andSales Expenses
General andAdministratives
Personnel Depreciationand
Amortization
Other Expenses 4Q11
Operating Expenses Composition- 3Q11 to 4Q11 (R$ million)
CIELO | OPERATING EXPENSES
15
In the comparison (2011 x2010),the main impact for the increase in the expenses were due to:
• other expenses – provisions for tax and labor contingencies;
• marketing and sales–campaigns with partners (banks and clients) and loyalty programs to clients
441,0
632.8
61,2 51,2
40,5 37,3 1.5
2010 Marketing andSales Expenses
Other Expenses General andAdministratives
Personnel Depreciationand
Amortization
2011
Operating Expenses Composition- 2010 to 2011 (R$ million)
CIELO | FINANCIAL PERFORMANCE
16
16.4%
CAGR:19.6%
Adjusted EBITDA (R$ million) Net Income (R$ million)
13.8%
CAGR: 20.5%
1.409,5
1.764,3
2.450,7
2.925,9 2.975,2
59% 61%
68% 67%
62%
45, 00%
50, 00%
55, 00%
60, 00%
65, 00%
70, 00%
75, 00%
0,0
500 ,0
1.0 00,0
1.5 00,0
2.0 00,0
2.5 00,0
3.0 00,0
3.5 00,0
2007 2008 2009 2010 2011
Adjusted EBITDA
715,9
833,2
62%
60%
45, 00%
50, 00%
55, 00%
60, 00%
65, 00%
70, 00%
75, 00%
0,0
100 ,0
200 ,0
300 ,0
400 ,0
500 ,0
600 ,0
700 ,0
800 ,0
900 ,0
4Q10 4Q11
Adjusted EBITDA Margin
883,9
1.115,3
1.536,7
1.829,3 1.810,3
37% 39%
42% 42%
38%
25, 00%
30, 00%
35, 00%
40, 00%
45, 00%
50, 00%
55, 00%
60, 00%
0,0
200 ,0
400 ,0
600 ,0
800 ,0
1.0 00,0
1.2 00,0
1.4 00,0
1.6 00,0
1.8 00,0
2.0 00,0
2007 2008 2009 2010 2011
Net Income
443,3
504,5
39% 37%
25, 00%
30, 00%
35, 00%
40, 00%
45, 00%
50, 00%
55, 00%
60, 00%
0,0
100 ,0
200 ,0
300 ,0
400 ,0
500 ,0
600 ,0
4Q10 4Q11
Net Margin
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